When we talk about the best examples of technology in the financial domain, it would be utterly surprised if we do not mention cryptocurrencies or virtual currencies whatever term you address them with. Being a new concept altogether, cryptocurrencies and their underlying methodology of blockchain technology have become an indispensable part of our financial system. Launched as the first cryptocurrency ever in 2009 by a group of people under the pseudonym Satoshi Nakamoto, Bitcoin enjoys its position of being the most successful and popular virtual currency in the crypto arena until the present. No industry can survive or improve without potential competitors; the crypto arena is no different. Soon after the launch of Bitcoin, an array of cryptocurrency coins and tokens surfaced in the market while some failed to leave an impact, some evolved as strong players who managed to survive in the industry. One such decentralized project is Ripple, the creator of XRP. Ripple was launched in 2012 under the guidance of Arthur Britto, David Schwartz, Ryan Fugger.
Both Bitcoin and Ripple stand tall as the strongest cryptocurrencies of present times. Where Bitcoin is the leading coin in terms of market capitalization, XRP is the third-largest in the same parameter. So, if you are inquisitive to know what actually makes these two cryptocurrencies stand different from each other, then it seems you are at the right place. This article will help you understand the core differences between Bitcoin and Ripple in a detailed manner covering all the major aspects. Have a look:
Bitcoin vs. Ripple: What are Their Purposes?
Bitcoin was launched when the world was under the plight of its biggest recession of all times and the global economy was at its worst. Business operations were on a halt and the value of fiat currencies faced a major downfall. Satoshi Nakamoto, in his white paper, stated that Bitcoin is a peer-to-peer network that aims to facilitate payment settlement for goods and services using a decentralized ledger technology. On the contrary, Ripple was conceptualized to cater to the requirements of big entities like banks and financial institutions. It works as a real-time gross settlement network, currency exchange, and remittance solution.
While Bitcoin was designed to substitute the traditional payment settlement systems, Ripple, on the other hand, strives to provide asset transfers in real-time through an interface that is simple, economical, secured, and transparent in comparison to other systems like SWIFT.
How Does XRP Work?
XRP and the XRP Ledger network promote more scalable, speedy, cost-effective, and innovative financial, technological expertise across the big payment zones. According to XRP news, The RippleNet protocol adopted by the network is quite different and advanced in comparison to other cryptocurrencies like Bitcoin and Ethereum. Unlike others, the Ripple network follows a consensus algorithm named XRP Ledger Consensus Protocol, which is very distinct from Work-of-Proof or Work-of-Stake. The consensus focuses on two main aspects: first, to decide the order of transactions for the next block and second to decide whether to include a transaction in the next block or not. This helps in eliminating the problem of double-spending. In consensus methodology, the power lies in the hands of the validators working on the network who are delegated to work together rather than compete with one another.
Each network node is connected to an openly selectable number of network validators. A ledger is created and approved after the validators give their nod to a set of transactions. The process then proceeds further and the network moves to the next one. As and when over 80% agreement is achieved signifying a matching order of transactions, the order gets accepted otherwise not.
Comparing Valuations & Technical Performance
Decentralization Level
Bitcoin is more decentralized than Ripple. The Bitcoins are spread across the globe and no one entity owns or controls the circulation or price fluctuations. On the other hand, Ripple is often considered to be centralized, as nearly 60% of XRP tokens out of the total supply are owned by Ripple. Visit our other pages to know about the XRP Price Prediction and current price of XRP coin.
Transaction speed
Speed is one of the major loopholes of the Bitcoin ledger network. It takes nearly ten minutes on an average to get a confirmation for Bitcoin transactions. Ripple is known for its speedy interface, which has a transaction confirmation time of fewer than 5 seconds.
Scalability
Ripple has an amazing scalability rate of processing 1,500 transactions per second, which is significantly gigantic when compared to Bitcoin, which can handle 3-6 transactions per second. For Ripple, the scalability rate can go up to 50,000 transactions per second.
Mining Stats
Mining is an inevitable part of the Bitcoin community network, which helps in its development and expansion in the form of Bitcoin rewards, which are given to miners for their efforts. Ripple, however, does not support mining at all. XRP has a total supply of 100 Billion. They have been pre-mined before launch, and only 38 Billion are available in the crypto market. The remaining are in Ripple Labs and can be released by the firm from time to time.
Conclusion
After reading the data mentioned above, you must be aware of the fact that Bitcoin and Ripple are entirely different from each other. Both the coins are categorized by their individual merits and demerits, which make them unique in their own way. Bitcoin strives to bring cryptocurrency in mainstream business by applying its usage in day to day operations of life while Ripple focuses on revolutionizing banking and big financial systems through blockchain and its native cryptocurrency, XRP. While Bitcoin still beats XRP in terms of market value, the latter is widely preferred for its high scalability and super-fast speed. So, it’s now entirely up to you, if you want to go for BTC or XRP to start on your intriguing crypto journey.
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